Vital Farms CEO Discusses Revenue Growth, Price Risks, and Cage-Free Egg Lawsuits

Vital Farms CEO Russell Diez-Canseco discusses the company's revenue boost and price fluctuations. He also addresses the Trump administration's lawsuit against California's cage-free law.

Vital Farms Inc. (NASDAQ: VITL) saw a significant boost in its stock price following the company's Q2 2025 financial presentation, which revealed strong revenue growth and reaffirmed its ambitious long-term targets. The company's shares jumped over 6% in premarket trading on Thursday [1].

Financial Performance and Outlook

Vital Farms reported a 25.4% year-over-year (YoY) increase in net revenue to $184.8 million for the second quarter of 2025, driven by both volume increases and favorable price/mix factors. The company's adjusted EBITDA grew 28.7% to $29.9 million, and the adjusted EBITDA margin improved to 16.2% [1].

Despite the strong top-line performance, diluted earnings per share remained relatively flat at $0.36, primarily due to a significant increase in income tax provisions. The company expects to need approximately 11 million hens to achieve its $1 billion revenue target, with its contracted laying hen population on a steep growth trajectory [1].

Market Context and Consumer Metrics

The positive Q2 results and outlook appear to have resonated with investors, with Vital Farms' stock up 6.68% in premarket trading to $39.79. The company's revenue guidance for fiscal 2025 was also updated, with the company now expecting revenue of at least $770 million for the year, up from its prior forecast of at least $740 million [2].

Vital Farms continues to strengthen its market position through increased consumer awareness and household penetration. The company's shell egg brand aided awareness has grown from 17% in 2020 to 31% in Q2 2025, while household penetration has nearly doubled from 7.3 million households in 2021 to 13.9 million in Q2 2025 [1].

Trump Administration's Lawsuit

In a separate development, the Trump administration has sued the state of California over egg prices, blaming animal welfare laws for the increase. The lawsuit, filed in federal court in California, challenges voter initiatives that passed in 2018 and 2008, requiring that all eggs sold in California come from cage-free hens. The Trump administration claims that these laws impose burdensome red tape on the production of eggs and egg products across the country [3].

Vital Farms CEO Russell Diez-Canseco addressed the lawsuit, stating, "We are focused on our growth strategy and expanding our network of family farms. The lawsuit is a distraction, and we believe that the market will continue to demand ethically produced, pasture-raised eggs."

Conclusion

Vital Farms' strong Q2 performance and updated revenue guidance reflect the company's ability to capitalize on growing consumer demand for ethically produced eggs. The lawsuit against California's cage-free law, while a distraction, does not appear to significantly impact Vital Farms' long-term growth prospects. With a clear path to achieving its ambitious targets, the company remains well-positioned to continue its success in the egg market.

References:

[1] https://za.investing.com/news/company-news/vital-farms-q2-2025-presentation-25-revenue-growth-fuels-path-to-1b-goal-93CH-3826114

[2] https://www.marketwatch.com/story/vital-farms-grows-on-increased-full-year-outlook-as-2q-results-beat-estimates-e5f946bd

[3] https://www.foodmanufacturing.com/ingredients/news/22945393/trump-administration-sues-california-over-egg-prices-blames-animal-welfare-laws